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2018 (7) TMI 933 - AT - Income TaxTDS u/s 194C - Disallowing/adding assessee’s hire charges - non deduction of tds - Held that:- We find no substance in Revenue’s instant grievance. It seeks to apply section 194C to treat the assessee’s hire charges in question to be contractual payments made for transportation of goods. We make it clear that there is no dispute about assessee being a firm engaged in transportation business and that it has indeed made the impugned hire charges payments to various lorry operators in lieu of engaging their respective vehicles on as and when required basis. Chapter XVII section 194C of the Act is applicable in case of payments made to contractors subject to various conditions envisaged therein. There is no material on record in the instant case file which could indicate that the assessee ever delegated its transport liability to the payees concerned. What it has done is to merely hire the transport vehicles without any corresponding liability being passed on to the payees in question by any written or oral agreement The assessee has also placed on record that necessary PAN details of its payees as per the scheme of the Act vide amendment through Finance Act, 2009 w.e.f. 01.10.2009 along with the corresponding quarterly form 27A; although belatedly. This is not the Revenue’s case that such a belated filing of details entails any penal disallowance. We therefore affirm the CIT(A)’s findings under challenge qua this issue of disallowance of hire charges Disallowance assessee’s repair and maintenance charges - tds liability - Held that:- An amount of ₹ 32,71,562/- represents assessee’s spare parts on outright sale purchase basis which does not require any TDS deduction since not attracting any of the specified clauses in Chapter XVII of the Act. Learned Departmental Representative fails to dispute that all the remaining payments are very well below the threshold limit of ₹ 20,000 in each case wherein the relevant TDS provision does not apply. The assessee’s ledger enclosed as marked –A7 to this effect has nowhere been rebutted during the course of hearing before us. We therefore see no reason to disturb the CIT(A)’s reasoning Adding the salary paid to drivers and khalas - Held that:- Assessing Officer has made both these two components of addition of salaries to drivers and khalas on mere estimation. We afforded ample opportunity to the Revenue to indicate about any actual sums being paid as per assessee’s books of accounts. It has come on record that the assessee had been having 11 permanent drivers and 5 khalas. It explained to have engaged them on make shift basis as clubbed in trip expenses. We thus decline the Revenue’s instant third substantive ground as well. Notional interest disallowance - Held that:- Referring to assessee’s non interest borrowing funds in its capital balance of partners reads a figure of rs.,1,24,21,710/- as against interest free advance made to M/s. Telecom Steels (P) Ltd. And Dayal Auto Finance involving sums of ₹ 36,56,600/-, ₹ 94,00,000/- ; respectively - the assessee had made advances for purchasing trucks in case of the latter entity. There is no material in the case file produced at the Revenue’s behest to dispel the CIT(A)’s clinching findings to this effect. The assessee’s ledger copies further indicated that former advance sum related to purchase of land and other assets. We therefore conclude that the CIT(A) has rightly deleted the impugned disallowance/addition - Revenue’s appeal is dismissed.
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